Slow day at the bourses as investors play it safe, STI closes 15 points down

Only 806.6 million shares were transacted across the whole market.
Only 806.6 million shares were transacted across the whole market.PHOTO: BLOOMBERG

SINGAPORE - Singapore shares had another slow day, with investors unwilling to enter the year-end market amid a dearth of good news.

The benchmark Straits Times Index (STI) fell for the second day, paring 14.84 points or 0.52 per cent to 2,861.19. Volume was also tepid, with only 806.6 million shares transacted across the whole market.

With such a low volume, local shares will be vulnerable to wild swings created by market events, and volatility will be the norm for the remainder of 2015, remisier Desmond Leong said.

"For instance, everyone is expecting a rate hike announcement by the Federal Reserve next week, but the fact is nobody really knows for sure. Not many will want to bet against this much uncertainty," he added.

In its Singapore equities report on Wednesday, Citi Research painted a similarly choppy outlook, tipping a slow year in 2016 with STI closing at 3,033 by year end - just slightly above the current levels.

"Singapore has been among Asean's weakest markets year-to-date, due to concenrs about the impact of China's slowdown," Citi said, adding Singapore companies will continue to face the pressure of economic restructuring.

Citi's top picks going forward include Venture Corp and ST Engineering, both United States dollar and hence less susceptible to currency pressure. Flight service provider Sats is also favoured for its strong cash flow generation and exposure to a growing aviation traffic in Asia.

ST Engineering was one of the better performers on the STI on Wednesday, rising two cents or 0.69 per cent to S$2.92. Sats also rose, up two cents or 0.53 per cent to S$3.82.

The top gaining blue chip counter was Noble Group, up 1.5 cents or 3.85 per cent to 40.5 cents, while Singapore Press Holdings put on two cents or 0.52 per cent to S$3.87.

On the other end of STI, Jardine Cycle & Carriage dropped S$1.02 or 2.86 per cent to S$34.62 while Thai Beverage went down 1.5 cents or 2.16 per cent to close at 68 cents, both targets of profit-taking after recent gains.

Global markets are being rocked by the still plunging oil prices as fears of supply glut pile up. As a result, the crude benchmark Brent futures hit below US$40 (S$56) per barrel overnight for the first time in almost seven years.

whwong@sph.com.sg